Pier 1 Imports lifted its earnings forecast for fiscal 2013, after it reported a strong growth in first-quarter earnings on higher comparable store sales. The specialty retailer of decorative home furnishings and gifts has made a turnaround since the recession, when it teetered on the brink of bankruptcy, struggled with declining sales and lost market share to discount retailers like Target (NYSE: TGT) and Wal-Mart (NYSE: WMT). Lately, Pier 1’s recovery has gained momentum on higher traffic gains of 8%, increasing same-store sales of 7.2% and higher average receipt per customer as it remodelled stores and streamlined its merchandise variety. In the quarter, gross margin improved 150 basis points to 41.6% and operating margin grew 170 basis points to 7.6%. The period ended May 26 were in line with Wall Street predictions, as Pier 1 reported a profit of $17.8 million or $0.16 a share, up from $14.1 million or $0.12 a share a year earlier. The company in April refreshed its growth plan with a new three-year guide, having outgrown its previous roadmap two years early. Similar to the company's previous strategy, the plan focuses on increasing online sales as well as building new stores and remodelling existing locations. Looking forward, the company also raised its full-year earnings guidance by $0.02 to range $1.08-1.14, while analysts expect earnings of $1.13 per share.

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